Where’s The Incentive To Go Electric?

Mon 21st Feb 2022

Motorists considering buying an electric vehicle in 2022 are likely to face higher costs than those who took the plunge last year due to rising energy prices and a fall in EV incentives.

2021 saw record sales of EVs, with a growing range of models across most car brands giving consumers a greater choice and more access at both ends of the affordability scale.

And while those considering the escape of rocketing fuel prices may still believe EV is better, the cost of energy, particularly electricity is also on the rise. Ofgem are raising the energy price cap in April, and that will hit gas bills but will also put pressure on electricity, and a report in the Daily Mail suggests that EV owners will pay an additional £12 to £16 per month compared to last year. Some energy companies offer preferable tariffs for EV charging, and it may be that these rates remain unaffected by the spike in energy costs.

“For many drivers, charging your car at home is as simple as charging your phone, and EV-specific energy tariffs like Octopus Go offer cheap, green energy in the middle of the night,” said Fiona Howarth, CEO of Octopus Electric Vehicles

“Filling your car on that overnight rate costs just £12 a month for a typical British driver - saving over £1,000 every year compared to old school petrol.”

Those who were looking to buy a brand new EV in previous years could have relied on a substantial Plug-In Car Grant, but as the cost of an EV has fallen, so has the government incentive to buy one - to such an extent that the most recent cut to the grant means potential buyers can only claim a maximum of £1,500 discount.

EV owners will also soon lose the £350 grant under the Electric Vehicle Homecharge Scheme, which ends in April and will see those who want to install a charger at their home having to pay all of the costs.

Speaking about the rising costs of owning an EV, Mike Hawes, Chief Executive of the Society of Motor Manufacturers and Traders said: “Electric vehicle take-up is surging, thanks to an ever-growing model range and compelling offers, such that we expect almost one in four new cars registered this year to have a plug. Government and society ambitions, however, are even higher and we have to accelerate if we are to meet our net zero goals. 

“Government can help by continuing to provide incentives that help all drivers make the switch, and investing in infrastructure so recharging is actually easier that refuelling. 

“With energy prices increasing, the role of such measures are even more critical, so we should be looking at every way to ease the burden of increasing costs or risk stalling take-up at the worst possible time.”